Basil blasts Harsha over China ‘hit man’ charge

Economic Development Minister Basil Rajapaksa is charging that UNP MP and its Chief Economic Spokesman Dr. Harsha de Silva’s outburst and criticism over growing economic cooperation between Sri Lanka and China was in bad taste and made with dangerous political twist. “He (de Silva) is trying to pit China against Sri Lanka’s friendly nations such as India and those in the West as well as scare China away from Sri Lanka,” Minister Rajapaksa told the Daily FT.

His remarks were in response to repeated criticism by the UNP MP who via a press conference on Friday alleged that China was an economic hit man (See Weekend FT edition of Saturday, 28 January) and excessive luring of Chinese loans was detrimental to the country, which would face serious consequences in the future.

“The UNP MP’s allegations are baseless and certainly politically motivated. His comments are also dangerous as they are double-edged, trying to create rifts in Sri Lanka’s friendly ties with all nations, big and small. In that context Harsha’s comments are detrimental in the national interest,” Minister Rajapaksa pointed out.

He also dismissed claims by Dr. de Silva that China, due to its massive financial support would force Sri Lanka to vote in its favour at the UN. “China has veto power in the UN. Anyway China doesn’t need Sri Lanka, but it is Sri Lanka which needs China, India and other countries as the Government is rapidly rebuilding and developing the country following the end of the conflict,” Rajapaksa emphasised.

“The main Opposition party must be more responsible and de Silva’s outburst is not only baseless but a departure from the responsible conduct of an MP,” Minister Rajapaksa opined, alleging that MP de Silva’s comments had sinister motives at a time when Sri Lanka and the UN were building trust and cooperation.

He also pointed out that given its own strong economic power, the world including the US and Europe was inviting more investments, both direct and into debt markets, from China and even India and its businesses were becoming global investors buying up assets, etc.

Minister Rajapaksa said that following the end of the conflict, not only China but India as well as several other nations including the UK, Germany, France, Netherlands, many from the Middle East and Japan and Korea, as well as multilateral agencies such as the World Bank and Asian Development Bank had stepped up their financial support to Sri Lanka. Chinese companies have won contracts even for some of the non-Chinese Government funded projects owing to their competitive bids, Minster Rajapaksa added.

Quoting from the latest Financial Management Report for June-September 2011 released by the Finance Ministry to Parliament under the signature of President Mahinda Rajapaksa, the UNP MP stated that even though US$ 785 million had been pledged by the Chinese and US$ 600 million had been disbursed, no money had been given as grants.

Countering this, Minister Rajapaksa said there were multiple projects which have been completed or launched via grants from China. Most of the projects are aimed at developing healthcare, arts and theatre, culture and sports in addition to several other socioeconomic infrastructure areas.

Some of the projects cited were the development of the Supreme Court complex, upgrading of the BMICH, the performance and art theatre in Colombo, rehabilitation of rail tracks as well as expansion of a few roads. A planned hospital for children and women in Ragama is a further grant project from China.

On his part, Dr. De Silva alleged that the Sri Lankan Government was agreeing to massively expensive infrastructure projects that were of little relevance to anyone else due to the influence of a handful of local politicians. He insisted that the results of this would be felt by the country years from now, when it is unable to make the repayments for the loans.

“Billions of dollars are being spent on white elephant projects that are of little relevance to the masses. Take for example the five-ships-a year harbours or the international cricket stadiums where few matches are ever played, coal power plants that do not work or the Lotus Tower with no earthly use to people – these are all projects that are funded by the Chinese,” he said.

The MP opined that when Sri Lanka cannot pay back the loans, China could well tap into the resources of the country and its strategic location for its own interests, which the Government would be powerless to prevent.